Pound Slides Amid Risk Aversion

The pound declined against its key counterparts in European deals on Monday amid risk aversion, as hawkish comments from Fed Chair Janet Yellen and her deputy Stanley Fischer coupled with a pullback in oil prices on signs of rising Iraq output sapped investors' appetite for risk.

While Yellen hinted that the case of interest rate hike has strengthened in recent months, Fed Vice Chairman Stanley Fischer subsequently indicated the possibility for tightening at the next review.

Amid lack of any positive triggers, market participants now await this week's global manufacturing surveys, the U.S. jobs report for August and the outcome of the upcoming Group of 20 Summit in Hangzhou, China, for further direction.

Oil prices fell on a high dollar, as well as uncertainty over whether OPEC and Russia will agree to curb supplies at meeting in Algeria late next month.

The pound showed mixed performance against its major rivals. While the pound declined against the franc and the euro, it rose against the yen. Against the dollar, it held steady.

The pound slid to a weekly low of 1.3063 against the greenback, following a high of 1.3139 hit at 7:15 pm ET. On the downside, 1.28 is possibly seen as the next support level for the pound.

The pound retreated to 1.2790 against the franc, coming off from a high of 1.2847 hit early in the Asian session. The pound is seen finding support around the 1.25 mark.

The pound edged down to 0.8550 against the euro and 133.59 against the yen, from its early 4-day high of 0.8513 and near a 4-week high of 134.39, respectively. If the pound extends decline, 130.00 against the yen and 0.88 against the euro are possibly seen as its next support levels.

Looking ahead, U.S. personal income and spending data for July are due to be released in the New York session.